Exploring Ethical Business in Central Europe: Leaders’ Values and Perspectives on Good Practices

Abstract

Weaknesses in the institutional environment of Central Europe challenge the sustainability of economic development. Institutional theory stipulates that institutions drive economic development, and institutions are configured by individual values and practices. The World Governance Indicators, the Corruption Perception Index, and the Doing Business Indicators indicate weaknesses in the institutional environments of the Visegrád countries. This paper explores the micro level perspective of institutions, focusing on values and practices, in terms of leadership and ethics. A survey of 868 private and public sector managers from Czech Republic, Hungary, Poland, and Slovakia provides evidence that leadership practices and ethical values are congruent, suggesting a positive influence on the institutional environment. The results also provide evidence for the presence of the gap, spanning between the micro and the macro level factors affecting sustainable economic development. These results imply that a bottom-up view of sustainable economic development is more suitable to the Central European context, and promotion of sustainable economic development needs to focus on the micro level factors.

How Important Is the Business Environment for The Performance of Enterprises? Case Study of Selected European Countries

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“…The political transition resulted in instability, economic pressure and hardships: Together, these made people perceive capitalism, liberalism and the "imported" democratic institutions as being unable to provide prosperity and welfare. This sentiment was bolstered by the skyrocketing unemployment and inflation rates, direct drop in living standards and increase in illegitimate forms of privatization [25]. These outcomes eliminated the initial enthusiasm.…”

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